This paper is aimed at modelling the flow behaviour of P91 steel at high temperature and a wide range of strain rates for constant and also variable strain-rate deformation conditions, such as those in real hot-working processes. For this purpose, an incremental physically-based model is proposed for the P91 steel flow behavior. This formulation considers the effects of dynamic recovery (DRV) and dynamic recrystallization (DRX) on the mechanical properties of the material, using only the flow stress, strain rate and temperature as state variables and not the accumulated strain. Therefore, it reproduces accurately the flow stress, work hardening and work softening not only under constant, but also under transient deformation conditions. To accomplish this study, the material is characterised experimentally by means of uniaxial compression tests, conducted at a temperature range of 900–1270 °C and at strain rates in the range of 0.005–10 s−1. Finally, the proposed model is implemented in commercial finite element (FE) software to provide evidence of the performance of the proposed formulation. The experimental compression tests are simulated using the novel model and the well-known Hansel–Spittel formulation. In conclusion, the incremental physically-based model shows accurate results when work softening is present, especially under variable strain-rate deformation conditions. Hence, the present formulation is appropriate for the simulation of the hot-working processes typically conducted at industrial scale.